Myanmar moving on with refinery without Guangdong Zhenrong: lessons for Curaçao

Since visiting Myanmar late 2016, I’ve written extensively about the failure of Guangdong Zhenrong Engergy (GZE) to deliver on promises made to this Asian country to build a refinery as part of China’s imperial One Belt One Road (OBOR) vision. GZE was eventually kicked out of Myanmar because of serious financial breach. Notwithstanding this information, Curaçaon (political) authorities were blinded by GZE’s flashy computer presentations promising not only a refinery here, but also casinos and a Las Vegas-style strip! Albeit too late, Curaçao desisted from continuing with this adventure.

It caught my attention that Myanmar has recently announced plans to build a large state-of-the-art oil refinery in Magwe Region, near an existing oil facility. This means that, if the refinery is built, it will not uproot thousands of local farmers and inhabitants as would have been the case had GZE continued with its plans. Environment and social impact of this project now play an important part after the GZE’s plans ended up being investigated by the United Nations.

The Government of Myanmar is expected to finance the refinery project in cooperation with the private sector and is moving ahead without GZE notwithstanding its relationship with China which is as “close as lips and teeth”. Undoubtedly the Burmese authorities are also aware that a whopping 234 infrastructure projects announced in the OBOR countries since 2013 have so far hit major problems. The huge Ituango dam in Colombia is a case in point.

Myanmar has revamped its energy policy by putting in place an energy data collection system; assigning highly qualified staff to government departments responsible for energy policy; sharpening the regulatory environment; investing in innovation technologies and an attractive fiscal framework for the sector.

Construction is expected to take between 3 and 5 years. There’re currently just two old oil refineries in the country – both of which are state-owned. One is currently non-operational, while the other is unable to produce fuels that comply with quality standards. Myanmar has vowed to be transparant in thenew refinery process and to steer away from political mudslinging, shady and ‘black box-like’ circumstances that led to the hasty MoU with GZE one day before the military Junta stepped down. The investigation and prosecution called for by the international community to investigate and prosecute the Burmese military leaders may shed more light into this matter.

Myanmar is the poorest country in Southeast Asia and shares a border with China. Not exactly comparable with Curaçao. Yet there are some lessons to be learned here.

Willemstad, Curaçao

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Author: alexdavidrosaria

Alex Rosaria is from Curaçao. He has a MBA from University of Iowa. He was Member of Parliament, Minister of Economic Affairs, State Secretary of Finance and United Nations Development Programme Officer in Africa and Central America. He is an independent consultant active in Asia and the Pacific.
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Alex David Rosaria (50) is from Curaçao and has a MBA from the University of Iowa. He is a former Member of Parliament, Minister of Economic Affairs, State Secretary of Finance and UN Implementation Officer in Africa and Central America.